Thousands of employees were left without paychecks when a cloud-based payroll processing firm shut down unexpectedly, Brian Krebs of KrebsOnSecurity reported.

The company MyPayrollHR, based in Clifton Park, New York, abruptly shut down operations earlier this month.

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In a message to clients, the firm cited “unforeseen circumstances” that would not allow them to “process any further payroll transactions.” Clients were also instructed to “be prepared to find an alternative method to pay employees.”

Nearly $35 million appears to have vanished after the incident, including money from payroll funds and even money already owed to employees, Krebs reported.

MyPayrollHR had been directly depositing funds into workers’ accounts on a biweekly basis, but many have noticed that their accounts were debited the exact amount they would expect to accrue, according to the report.

Some even noticed this has occurred twice, docking them an entire month’s earnings and leaving their accounts with a negative balance.

Employers were left scrambling to find resources to pay their workers, and the FBI has taken an interest in the case.

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As we continue to seek information regarding the alleged activities of MyPayrollHR and its affiliates, the #FBI is asking all impacted business owners to please fill out the questionnaire linked below. https://t.co/zHLGJFnuiW

Cachet Financial Services, the California-based company that facilitated payments for MyPayrollHR, provided details of the incident, Krebs reported.

For over 12 years, Cachet had received digital files documenting which employee accounts were to receive deposits and how much those deposits should be.

The funds from MyPayrollHR clients would then be collected into one giant holding account, maintained by Cachet, before being disbursed to all of the thousands of employee accounts.

This process went smoothly until Sept. 4, according to Cachet. Instead of sending about $26 million to the standard holding account, MyPayrollHR directed it into its own account at Pioneer Savings Bank.

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In an apparent attempt to defraud the processing company, MyPayrollHR’s regular payroll file then instructed clients to pull from the Cachet holding account as usual, despite it being empty.

In response, Cachet requested that the transactions be reversed, since it did not have the $26 million it was owed by MyPayrollHR. This is what caused some employees’ bank accounts to shrink.

Upon realizing this, Cachet quickly notified banks that processed its reversal request to cancel, returning paychecks to employees and leaving Cachet on the hook for $26 million. That’s when the company went after MyPayrollHR, Krebs reported.

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According to Wendy Slavkin, general counsel for Cachet, the company was able to reach Michael T. Mann, CEO of MyPayrollHR, by phone shortly after the incident, Krebs reported. Mann allegedly failed to return the call as promised, and his firm abruptly shuttered shortly after.

The $26 million fraud isn’t the only hit MyPayrollHR is accused of orchestrating, as it was also allegedly able to stiff National Payment Corp. — the firm that handles client tax withholdings — for over $9 million.

Cachet hopes that insider crimes will be easier to prevent in the future, and the company is taking it upon itself to make sure of that, Krebs reported.

“Our system is excellent at protecting against outside hackers,” Slavkin said. “But when it comes to something like this it takes everyone by complete surprise.”